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- Forsbacka, Kristina, et al.
(författare)
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A Legal Analysis Of Terms and Conditions For Green Bonds : Focus on the Financial Markets in the Nordics
- 2019
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Ingår i: Europarättslig tidskrift. - : Europarättslig tidskrift. - 1403-8722 .- 2002-3561. ; 3, s. 397-442
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Tidskriftsartikel (refereegranskat)abstract
- The global financial system needs to be aligned with the energy transition to alow-carbon future. Green bonds, i.e. bonds specifically earmarked to be usedfor climate and environmental projects, issued by public and private issuers areimportant for funding climate and sustainable projects. However, although thegreen bond market has shown exponential growth in recent years, it still doesnot account for more than around 2% of global bond issuances in the last twoyears.1 The purpose of this paper is to analyse and discuss if the Swedish, Finnishand Danish green bond markets (here the Nordic green bond market2) couldbe made more effective by strengthening the legal contracts and if, and to whatextent, legal regulation is required and desirable. Effectiveness is here defined as facilitating for an increased issue of green bonds, without compromisingthe integrity of the bonds (“greenwashing”). The paper includes a review andanalysis of the contract documentation of the issuers on the Nordic green bondmarket, a study that has not been made before. The issuers’ impact reporting ofgreen bonds is also analysed, as impact reporting is central for the transparencyof green bonds. Ongoing EU regulatory and related initiatives that may affectthe green bond market are discussed. The research indicates that the introduction of “green” undertakings in the contracts would not make the green bondmarket more effective. Regulation should support unification and transparency,but needs to be flexible and non-exclusive, or it could hinder growth and innovation of the market, and increase the risk for greenwashing.
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| 2. |
- Forsbacka, Kristina
(författare)
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Climate Finance and the Point of Green Bonds
- 2021
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Licentiatavhandling (övrigt vetenskapligt/konstnärligt)abstract
- The emergence of green bonds in 2008 has been perceived as an important means to move towards green and sustainable investments, and the green and sustainable bond markets have also grown exponentially. The purpose of my thesis is to analyse the green bond instrument and the role that it plays at climate finance. Notably, the role of the green bond and climate finance has changed over time. The Paris Agreement from 2015 was the first climate agreement to address the finance sector, and the sustainable finance markets are now moving forward at a swift pace, with new and innovative products developing and rewarding green and sustainable investments. The essence of the research is threefold. Firstly, an analysis based on an empirical study and analysis of the terms and conditions of the contracts between issuers and investors regulating green bonds on the Nordic market. Secondly, an analysis of the new innovative bond instruments – transition bonds and sustainability-linked bonds – following the green bond that have emerged starting in 2019. Thirdly, the green bond instrument is analysed in its historical context, describing the role of carbon pricing and comparing the green bond instrument to experience from early project-based climate finance, the Clean Development Mechanism (CDM). To conclude, an analysis is provided of the green bond instrument and the role that it plays at the transformation to a climate-resilient and sustainable society. The perspective in the analysis and the discussion is normative and forward looking (“de lege ferenda”), based on experience – “lessons learned” – from the development of early climate finance and the development that the green and sustainable bond market has undergone. The ultimate purpose is to analyse the role the of the green bond at climate finance. My analysis addresses the interplay between coercive and voluntary regulation of the green bond instrument. The theory and findings of the thesis are that flexibility should be provided to market participants to allow for the development of new innovative instruments, based on the tools and infrastructure developed at climate finance and green and sustainable bonds. Legal regulation should focus on information and disclosure of climate-related and sustainability risks, and providing clarification and codification of definitions and standards for this purpose. The tools and infrastructure created for green bonds, and further developed for other emerging innovative bonds, could be used to provide transparency at sustainability at all finance. As climate-related and sustainability risks are disclosed and addressed properly is provided and fiduciary duties are developed, the financial market can move from rewarding “green”, to penalising “brown” investments. When “green” is the new normal there will be no need for a specific green bond instrument. The point of green bonds is being part of this journey – not the solution.
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| 3. |
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| 4. |
- Romson, Åsa, et al.
(författare)
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The Swedish Climate Policy Framework Including the Climate Act
- 2020
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Bok (refereegranskat)abstract
- To conclude, the Swedish CPF with the Climate Act, indicative and long-termclimate targets, and the Climate Policy Council have been in force since 2018. Th eyaim to structure the government’ s work on Swedish climate policies and requestsby law so that the government acts to fulfi l national targets on climate mitigation.Sweden has decided to reach net-zero emissions by 2045 at the latest and has alsoset a series of interim targets. Th is ambition is well ahead of the present EU climatetargets and Sweden has intentions as a country to take a leading role in combatingclimate change.Th e Climate Act is general in nature and only includes fi ve sections, with afocus on the government’ s planning, monitoring and reporting to Parliament.Th e specifi c climate policy measures are regulated separately. Th e role of theClimate Policy Council, which mainly consists of scientists from a broad range ofdisciplines, is to evaluate the government’ s progress towards the climate targets.Regular and transparent reporting on policies and their effects on greenhousegas emissions is seen to contribute to the clarity, continuity and long-term natureof the climate policy. Th e Climate Act does not provide for a legal review of thegovernment’ s actions or inactions. However, there is a constitutional obligationfor Parliament to control the work of the government and this obligation washighlighted when preparing the Act.Th e CPF is based on a broad political agreement that was negotiated in anAll-Party Committee, in which experts from both environmental NGOs and thebusiness sector also participated. 84 Th e CPF had as its models both the UK ClimateChange Act 2008 and a Swedish Fiscal Policy Framework which has been in placesince the mid-1990s. Another inspiration was the Paris Agreement, as negotiationson the Swedish framework were held in parallel with the process for the globalagreement.To legislate for climate issues with a Climate Act is a novelty in Sweden. Th elegal form of the Climate Act, which gives the government a general instructionto ensure that climate action is taken, is a new form of legislation, and thusthe implications for climate policies and for climate regulation in the SwedishEnvironmental Code are not yet clear. Th e Climate Policy Council has alreadypointed out the need for additional legal climate regulation for the governmentand the legal system in order to have suffi cient tools to ensure that the Swedishclimate targets are achieved. Going forward, it is clear that legal researchers havean important role to play in order to deepen the understanding of the legal systemin the context of national and global climate governance.
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| 5. |
- Vulturius, Gregor, et al.
(författare)
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Sustainability-linked bonds - their potential to promote issuers’ transition to net-zero emissions and future research directions
- 2024
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Ingår i: Journal of Sustainable Finance & Investment. - : Taylor & Francis. - 2043-0795 .- 2043-0809. ; 14:1, s. 116-127
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Tidskriftsartikel (refereegranskat)abstract
- Sustainability-linked bonds (SLBs) promise to complement the use-of-proceed model of green bonds by tying general purpose debt finance to issuers’ sustainability performance against predefined targets. In this commentary, we highlight that the potential of SLBs to promote issuers’ climate transitions crucially depends on a common understanding of eligible economic activities and material performance indicators, the use of science-based targets as best practice, the ability of borrowers to dispel concerns about greenwashing risk, and bond characteristics that set meaningful incentives for issuers to improve their carbon performance. Future research should investigate the climate-related additionality of SLBs, assess if bond characteristics and changes in capital costs support issuers in meeting or even increasing their climate targets and deter unsustainable investments, and better understand the challenges and opportunities for the SLB market to bring about system-level innovation to the financial system.
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